Tuesday, April 11, 2017

Investing Peace of Mind

Maintaining Peace of Mind Despite Market Fluctuations

Every day, the stock market goes up and down like an angry mustang that doesn't want to be broken! Today was an example of a big downswing in the morning, followed by a near-full recovery later in the day:


screenshot of Google Finance Dow Jones Industrial Average report for April 11, 2017


screenshot of Google Finance S&P 500 report for April 11, 2017

Patience is the order of the day—every day! Especially with investing!

Stock market growth is an inevitability over the course of long periods of time (10 years, for example). As shown by the chart below, the S&P 500 is now worth over 10 times what it was in 1970, in spite of several 'financial crises' in the intervening years!


The Dow Jones Industrial Average exhibits a similar pattern. Over a long time horizon, the market goes up inexorably, reflecting the fact that most of the companies with publicly-traded stocks will continue to make money.

If you haven't already done so, you can join the party by buying shares in an S&P 500 index fund, or even a total-market index fund like Vanguard's total-market index fund, VTSAX.

So no matter what the market does, don't let that affect your state of mind! Peace of mind is a beautiful thing: http://www.tawcan.com/breathe-relax-world-is-not-ending/  This link may be a bit old, but its message is timeless, and presents a much-needed reminder to stop, take a deep breath, relax, and remember that the sky is not actually falling!